Which of the Following Steps Is Required to Adjust LIFO

question 23

Multiple Choice

Which of the following steps is required to adjust LIFO to FIFO?

• A)Inventory needs to be calculated as reported LIFO inventory plus LIFO reserve.
• B)Increase deferred tax payable by LIFO reserve times Tax rate.
• C)Retained earnings need to be calculated as reported retained earnings plus LIFO reserve times (1 - Tax rate).
• D)All of the above

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Definitions:

Total Liabilities

The sum of all financial obligations a company owes to outside parties.

Dividends Declared

An announcement by a company's board of directors of a dividend payment to shareholders, indicating the amount and payment date.

Dividends Payable

A liability on the balance sheet representing the amount of dividends that a company owes to its shareholders but has not yet paid.

Stock Splits

An action by a company to divide its existing shares into multiple shares to boost the liquidity of the shares.